Entrepreneur Interview Assignment
MBAX 6130 – Sustainable Venturing
November 3, 2011
Grace Skis was founded in Denver, Colorado in early 2010 “with a vision to build a high performance, durable, big mountain free ride skis for the informed skier” (www.skigrace.com). Grace Skis Founder and Owner, David Liechty, started the company for two reasons: for the love of skiing and a passion to create something tangible (Email: firstname.lastname@example.org, phone: 303.396.4240). These two reasons are an integral part of who dave is and where he came from. He holds a bachelor’s degree in industrial design and a master’s degree in Landscape architecture. In between degrees, he was a competitive skier. Simply stated, Dave epitomizes the effectual entrepreneur. When the economy turned a few years ago, he was laid off. Instead of deciding to find another job he would not like, in a corporate atmosphere he found stifling; he used his means (who I am, what I know, who I know) and decided to follow what he loves: ski.
Grace skis was started on a Wednesday without a formal business plan in place, no determined spending, and no real control. Dave applied for and received his business license and then built a prototype ski and skied them. Dave’s business plan for Grace Skis can be summarized by the following four step process:
Idea Execution Rock Bottom Climbing
Dave stated that a lot of people fail because they do not execute on an idea. There are a thousands of good ideas out there and people are either scared to execute or give up when they hit rock bottom. To Dave, hitting rock bottom is probably one of the biggest challenges in starting Grace Skis; but he also feels it is an important step. When people see that you have given up everything for a company; then they will believe in your product. For example, Dave decided not to seek out investors or financiers to start Grace Skis (a key component to the rock bottom step). However, through dialogues with family and friends, two investors did come “out of the woodwork” because they believed in the company and believed in Dave. Currently, Dave considers Grace Skis to on the climbing leg of his business plan and the end goal will be to achieve “success with flexibility while not compromising integrity and character”.
Dave decided to start Grace Skis because of a passion for “design, creation, skiing, and moving away from abstraction”. In his previous job as a landscape architect, he rarely saw his plans executed. He also wanted to work in an environment that was less corporate and more enjoyable. Two examples that demonstrate these motivations for starting Grace Skis are as follows. First, Dave did not want to outsource the ski manufacturing. He wanted to be an integral part in the creation of the skis. Second, Dave spoke about the joy he has in working for Grace Skis. One afternoon he was working and he was simply smiling. Grace Skis does not feel like work.
The motivation behind the creation of skis is to build skis that perform and that propels the skier to “ski the best that they can”. Not all the skis Dave had built thus far have been successes. Dave and the Grace Ski team are very honest about their failures. The team often blog about their failures and their successes in all aspects of the business. These failures also motivate Dave to continue to build skis. If it was easy, it would be boring.
The goal of Grace Skis is to make solid, environmentally respective, innovative, big mountain skies for the free riding skier. This skier currently represents the top one percent of skiers (e.g. professional/competitive skiers and ski patrollers). Grace Skis was founded by Dave who fits into this category and has seen a shift in the priorities of the outdoor industry. Dave knows like-minded people who share this common frustration (pain) and want to go back to purist, big mountain skiing. To this end, Grace Skis are simple, durable, and designed for performance.
When asked specifically what makes their skis unique, Dave stated that this was a question that he often gets. He said that the honest answer is nothing. All skis are made the same way, but what makes Grace Skis unique “are the people who buy Grace Skis and how we define ourselves as a community, how we help the environment, and how we expand on this thing called skiing”. For example, Grace Skis sponsors skiers, and one of the main criteria that Grace Skis is looking for is character. Dave wants Grace Skis to be recognized as a character-based company (over performance-based).
This identity is also pervasive in the marketing that Grace Skis does. Currently, Grace Skis only uses social media. The key to using social media is to develop a good formula, maintain consistency in the message, and make sure that message is pure and honest. People will respond. Dave firmly believes in honesty in marketing and tries to stay away from catch phrases or jargon words that might mislead people into thinking Grace Skis is something that it is not. Additionally, Dave is careful to say the marketing will never be bigger than the ski itself.
The most interesting discussion on community originated when competition was discussed. Dave does not believe that he has competition. Dave’s hope is that when people want to purchase skis; they will think of Denver as the place to go. To this end, Dave stated that each of his competitors all do “their thing a little bit differently” and if all the companies out of Denver/Colorado are getting better; then it is a victory for the Colorado Snowsports industry. The community expands and everyone benefits.
“Do More with Less”
Normally this section would have been titled “sustainability”, but Dave is not partial to that word. Dave believes the term sustainability is vague and open to contradictions. If he was truly sustainable he wouldn’t be making skis and driving his truck up to the mountains. That being said, Dave is very passionate about producing his skis with minimal impact to the environment. His mantra is “Do more with less”. He emphasizes building the skis local in Colorado (not China), reusing materials, keeping scraps, and using tools that date back to his grandfather (three generations using a tool made from American Steel) to craft the skis. It is difficult to make any product that has zero impact on the environment and Dave has tried to unsuccessfully track down and create a sustainable nursery comprised of a Mega flora hardwood tree that can grow 30 feet in three years. He has also experimented with the idea of creating skis from Gypsum and Castor oil (an edible ski!), but the material ripped like rubber. Not all of Dave’s ventures towards environmentally friendly skis have been failures; however, these failures illustrate the passion Dave and Grace Skis have to try to push the envelope on traditional ski making.
Grace Skis: A Success Story So Far
I think that Grace Skis is on the climbing limb of their business plan for several reasons. 1. Dave has stayed true to his vision for the company, has established a consistent message, and has established relationships with suppliers, partners, and employees. 2. He is honest about his successes and failures, and 3. He is a good example of an effectual entrepreneur. He used his means to develop a company that he is passionate about and that he knows a lot about (in terms of product, customers, people). He started with his strengths, he has not had to chase investors, and he did not have to wait for an opportunity. Dave knew there was a gap in the market for the boutique ski industry, and using what he knows, who he knows, and who he is, he has been able to gain recognition for his company in under 2 years.
All businesses are vulnerable to a degree, especially in the nascent stages and Grace Skis is no exception. Although Dave has laid out an excellent framework for his company through effectuation and a vision/business plan that is flexible; two areas of improvement come to mind. One area is concern that his target market may be too small. Dave doesn’t like the term growth either, but if he wants to pay his employees in more than just skis, it may be worth making a ski that might appeal to expert and advanced skiers as well. Colorado has many skiers that love to ski and value the same ideals that Dave wants to foster in his Grace Ski community and would appreciate what purchasing a Grace Skis means. This would also include expanding his marketing outreach beyond the use of social media. Dave did express interest in joining trade organizations and attending trade shows, but he hopes that he does not have to do that. The second area of concern is that Dave may not have evaluated the risks associated with a more mature company and may not be using the best metrics for success in the future.
Success is not measured in quantifiable terms for Dave and the Grace Skis team. They judge success in happiness, keeping an honest approach to doing business, and investing in the environment. These may sound short-sighted, but these are the most important metric for Grace Skis. Dave stated that as long as he is happy working on Grace Skis, the company is a success. Of course, Dave does measure success in more quantifiable terms, but it is only secondary. Secondary success is measured by the relationships that Grace Skis has with its suppliers, retailers, and customers. This metric is quantifiable and is based on # of customers, # of skis sold, and a Grace Ski presence at selected retails shops. Based on his primary metrics, Grace Skis is a success to Dave and to me and to the people that have started to buy his skis, invest in his company, and work for his company (paid in skis!)
I am not sure if I have the entrepreneurial spirit. I think I would fall into the category that Dave would describe as “afraid to execute or hit rock bottom”. I am not sure I will ever launch my own company; however, I have tried to launch a new service offering within my own company. The interview with Dave was eye opening even for an “intre”preneur like me for several reasons:
1. Effectual entrepreneurship can be successful. By using means, a company can be developed that is not only successful, but enjoyable to work for (It may not feel like work!).
2. It is okay to fail. Dave advertises his failures. Dave knew he was going to hit rock bottom; it was in his plan. That did not stop him from pursuing his passion. I think the fear of failure has held me back somewhat in trying to pursue a new service offering; but maybe it is okay to hit rock bottom.
3. Brand identity (community) can be what makes a product unique in a crowded marketplace. Dave trusts that the community he is trying to build with Grace Skis will also help make it a successful venture. It helped me to realize that it is important to consider the type of clients/customers we may want to take on as a company. Is it wise to continue to do business with a company that looks for the shortcuts and is in regular trouble with the law? How does a negative relationship affect our company’s reputation?
4. It is okay to be realistic about sustainability. Too many companies fall victim to “green washing” and self-righteous rhetoric. I think it is important to always be honest with your customers/clients in setting realistic expectations. Dave has also started researching philanthropies such as 1% for the environment and POW (protect our winters). His dedication to creating an environmentally responsible ski and company will be integral to the success of Grace Skis and not an afterthought.